I am a strong supporter of microenterprise development, and I believe the Community Development Financial Institutions fund (CDFI) is one of the best ways the federal government can foster this important segment of the nation's small businesses. I understand the concerns of many that the management of this program has not lived up to expectations. However, I believe CDFI's programs, especially regarding microenterprise development, are too important to the financial health of this country and must be continued. Very small businesses, those employing I to 4 people, created more jobs from 1992 through 1996 than all large businesses (those employing 500 or more) combined.

The Community Development Financial Institutions (CDFI) fund represents a new type of community investment initiative. It uses limited federal resources to invest in and build the capacity of private, for profit and nonprofit financial institutions, leveraging private capital and private-sector talent and creativity. The fund's main program allows local CDFIs to apply for financial and technical assistance. This funding can be used to support basic financial services, housing for low-income people, businesses that provide jobs for low-income people and technical assistance for capacity-building, training, and development of programs, investments or loans.

The CDFI fund offers a combination of increased access to capital and institutional capacity building that is vital to low-income communities and fill a need that the marketplace is not meeting. Andrew Fuentes wanted to start a homemade furniture business but was turned down by several banks when he applied for a loan because of his credit history. Eventually, he applied for and received a $3,000 loan and technical assistance from ACCION Texas to help buy inventory. Soon he filled his shop with furniture and his sales doubled.

Its stories like these that illustrate the success of microenterprise assistance. I believe the opportunity that Mr. Fuentes received should be replicated for everyone who wants to share in the American dream of starting their own small business. We have all heard a lot about the need for individual responsibility, family responsibility, and community responsibility. The microenterprise program within CDFI gives us an opportunity to lend a helping hand to those in need of financial aid and technical assistance so they can fulfill their personal, family and community responsibilities. It has given many people a chance to break the cycle of poverty and welfare and move toward individual responsibility and financial independence.

I am committed to helping microenterprise overcome what I see as its three major challenges: first, securing as much funding as possible for technical assistance for microborrowers; second, finding ways to expand existing programs that support microenterprise development, such as the CDFI program and the Small Business Administration's Microloan program; and finally, developing stable and reliable sources of capital to finance microloans.

I would like to work with other members of this Committee to expand the microenterprise work done within the CDFI fund to reach everyone who wants to share in the American dream.

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